The Australian government will provide A$82mn ($59mn) to two hydrogen hub projects in the Hunter Valley as the nation looks to develop its status as a global exporter of the fuel.

The funding will be split equally between the Port of Newcastle’s hydrogen hub, which has a project value of A$163mn and Origin Energy’s Future Fuels H2 hub, which has a project value of over A$200mn.

“Australia will be a world leader in hydrogen development and exports, and the Hunter region is critical to realising our nation’s potential,” says Prime Minister Scott Morrison.

The Port of Newcastle hub is a joint venture between investor Macquarie Capital and Macquarie-owned Green Investment Group and is currently undertaking a feasibility study. The hub will look to connect domestic and export infrastructure, nearby demand, and renewable energy assets.

A$850mn – Amount set aside in Australian budget to fund hydrogen technologies

“The significance of this funding cannot be understated. By 2025, we hope to have phase one of the hydrogen hub complete,” says Craig Carmody, CEO of the Port of Newcastle.

The federal government has also previously provided A$100mn as part of its budget to help the port prepare its land and infrastructure to become a hub.

The Origin Energy hub is a joint project between that firm and mining firm Orica. It would use a grid-connected 55MW electrolyser to generate green hydrogen to power local industrial and manufacturing processes as well as some heavy transport applications. It will also investigate the feasibility of converting the local gas distribution network to 100pc hydrogen.

Both hubs are backed by private-sector funding and are in talks with industrial offtakers.

Distributing finance

The money will come through the government’s clean hydrogen industrial hubs scheme which aims to develop regional hydrogen hubs in Gladstone, Darwin, Tasmania, the Eyre Peninsula, Pilbara, the Latrobe Valley and the Hunter Valley.

Earlier this month, the H2 Hub Gladstone project in Queensland was granted major project status by the state government. The 3GW green hydrogen hub is being developed by Australia’s Hydrogen Utility and aims to produce 5,000t/d of green ammonia. The project expects to commence operations in early 2024 and also has Orica as a partner.

“Australia will be a world leader in hydrogen development and exports” Morrison, Australian prime minister

Australia has set aside A$850mn to invest in hydrogen technologies as part of its 2022-23 budget as the nation looks to become a major exporter of the fuel.

Green hydrogen production costs are expected to decline to A$2-4/kg by 2030, according to a State of Hydrogen report from the country’s Department of Industry, Science, Energy and Resources.

Growing industry

Japanese firms have signed a number of provisional agreements with Australian companies as the nation looks to secure supplies of hydrogen, with Japanese gas firm Osaka Gas recently joining Australia’s 10GW Desert Bloom green hydrogen project—one of the largest in the world.

Clean hydrogen exports could directly support 16,000 jobs by 2050 plus an additional 13,000 jobs in renewable energy infrastructure construction, the government says, claiming that clean hydrogen production for both export and domestic use could generate more than $50bn in additional GDP by 2050.

Australia has a federal election on 21 May. The latest polls from Newspoll show Morrison’s coalition struggling to gain ground on Labor in two-party preferred terms. But Morrison maintains his poll lead as preferred prime minister over Labor leader Anthony Albanese.

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Author: Tom Young